In this article, you'll learn the reasons to switch from Amazon FBA to Amazon FBM and the benefits you secure by doing so. We'll also show you what to keep in mind during the move.
Your own online shop strengthens your e-commerce brand and creates a personalized customer experience for buyers. But when it comes to reaching new audiences effectively and driving more revenue growth, there's no way around multichannel sales.
Many online retailers turn to Amazon as an additional sales channel. Those who use the Fulfillment by Amazon option and hand fulfillment over to the marketplace often realize with disappointment: the brown shipping boxes with the Amazon logo are far from branded or personalized. It's different with the Amazon FBM option, where you handle fulfillment yourself.
In this article, you'll learn the reasons to switch from Amazon FBA to Amazon FBM and the benefits you secure by doing so. We'll also show you what to keep in mind during the move.
When people hear online shopping, many automatically think of Amazon: 65 percent of people who shop online start their product search on the US-based marketplace — making it the most important product search engine in Germany, ahead of Google.
Today, businesses can also handle their purchases through a dedicated B2B marketplace called Amazon Business. In 2022, the US company generated nearly 514 billion US dollars in revenue from business and private customers — including 33.6 billion US dollars in Germany alone.
To ride the e-commerce success wave and benefit from Amazon's strong brand recognition, you can offer products on the e-commerce giant's marketplace alongside your own shop and other sales channels.
Sellers get to decide for themselves how they want to handle fulfillment for their Amazon sales. Specifically, you can:
Anyone exploring selling on Amazon — especially FBM — will run into another term: "Prime by Seller" (Seller Fulfilled Prime = SFP). With this setup, online retailers can ship to Prime customers from their own warehouse.
The catch: if you want to use SFP, you need to meet Amazon's Prime requirements — for example, an order cancellation rate of no more than 0.5 percent and an on-time delivery rate of at least 90 percent.
In this article, though, we'll focus on Amazon FBM and FBA.
If a shop chooses FBA, Amazon takes over the entire fulfillment process. This includes:
This way of selling on Amazon mainly pays off for retailers who want to save resources and focus on their core business. The online shop only has to send products to an Amazon logistics center — Amazon handles the rest.
One advantage of FBA is that products fulfilled through Amazon are often listed higher in search results than FBM products. Shops also get direct access to Amazon's Prime program.
A downside — especially if you sell across multiple channels like your own shop, other marketplaces, and Amazon — is that you have to split your inventory. FBA users also have to follow strict labeling guidelines and budget for additional fees, including:
From this perspective, FBA is more suitable for small, low-variant products with high margins, since otherwise the FBA costs eat into your margins too much.
While Amazon offers an all-in-one fulfillment package with FBA, with Amazon FBM you use the marketplace purely as a sales platform. You stay in control of storing and shipping your goods, and you also stay in the lead on customer support.
To use Amazon FBM, you either need your own warehouse or you simply work with a fulfillment provider who handles storage, packaging, and shipping based on your specifications.
Fulfillment by Merchant is a good option for e-commerce pros — for example, if you sell product bundles. Only FBM offers the packaging flexibility you need. Plus, with FBM, businesses are independent of Amazon's policies, which can change at any time.
Already using FBA, or trying to choose between FBA and FBM? There are two big reasons to (switch to) Amazon FBM.
When you have full control over fulfillment for your Amazon offering, it boosts your e-commerce brand visibility on one hand, and improves your customer relationships on the other.
From your customers' perspective, FBA means:
If your customers run into shipping issues, the blame falls on Amazon — but on the flip side, you have no chance to shine with outstanding service and a strong post-purchase experience that builds your brand.
With Amazon FBA, service is a black box. You have no visibility into the returns process or the communication Amazon has with your customers. Inventory handling in the Amazon warehouse is also outside your control.
The FBM approach, on the other hand, brings five key benefits to your e-commerce business and your brand:
More control and creative freedom sounds good? Then the only question left is how to build effective FBM workflows for your business. The biggest blocker is often a lack of capacity to handle fulfillment independently of Amazon.
Many companies trust the experience of fulfillment providers like Zenfulfillment: the provider takes over critical tasks like storage, picking, shipping, and efficient returns processing — whether it's an Amazon order or one from your own shop.
You get all the upsides Amazon has to offer while saving on FBA fees and avoiding the loss of control over shipping and returns. The entire shipping process stays in your hands — for a strong unboxing experience and an even stronger bond with your customers.
With Zenfulfillment and Amazon FBM, you get:
All without overloading your resources.
Learn more about Zenfulfillment as a fulfillment provider
Competition in e-commerce is fierce — and small details often decide which retailer wins customers over. With Amazon FBA, you reach a large audience, but you can't stand out with custom packaging, goodies, and a memorable unboxing experience.
If you're already using FBA and want to switch to FBM, or you're choosing FBM from the start, Zenfulfillment has your back. You get efficient fulfillment workflows and the same level of control over shipping as in your own online shop — paired with the benefits Amazon offers as a marketplace.
Companies can't succeed in e-commerce on Amazon alone. But anyone who uses the marketplace as a complement to other sales channels like their own online shop benefits from the platform's unmatched reach. For people looking to shop online, Amazon is the first stop. So the platform shouldn't be underestimated as a sales opportunity.
Companies that want to offer their products on Amazon can either let Amazon handle fulfillment (Fulfillment by Amazon, FBA) or handle the post-sale shipping steps themselves (Fulfillment by Merchant, FBM). The latter has the advantage of keeping the customer experience in the retailer's hands. Especially for e-commerce companies that prioritize strong branding and closeness to customers, FBM is often the better option. On top of that, FBM is often financially more attractive than FBA.
To use the FBM program while still saving resources, you need well-functioning fulfillment processes and know-how in the area. With experienced partners, switching to FBM or starting on Amazon with FBM is straightforward.
The cover image is by Bryan Angelo on Unsplash, the additional image by Mildlee on Unsplash.
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